Moody’s upgrades Tesco

Moody's Investors Service said it assigned a long-term issuer rating of Baa3 to Tesco plc.

Concurrently, Moody's upgraded the senior unsecured ratings of Tesco and its guaranteed subsidiary Tesco Corporate Treasury Services plc to Baa3 from Ba1 and the short-term of Tesco and its guaranteed subsidiary Tesco Treasury Services plc to Prime-3 from Not Prime.

The outlook is stable.

Moody's withdrew Tesco's previous corporate family rating of Ba1 and probability of default rating of Ba1-PD following its upgrade to Baa3.

“Today's upgrade reflects the improvement in Tesco's operating profit over the last few years and our expectations of continued profit growth, cash generation and debt reduction amidst a challenging competitive environment,” David Beadle, Moody's senior credit officer and lead analyst for Tesco, said in a news release.

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